When using one of the discounted cash flow methods to evaluate the desirability of a capital budgeting project,which of the following factors is generally not important?
A)method of financing the project under consideration
B)timing of cash flows relating to the project
C)impact of the project on income taxes to be paid
D)amounts of cash flows relating to the project

Question

Quizplus · Accepted Answer

The method of financing the project is generally not important when using discounted cash flow methods to evaluate a capital budgeting project. The important factors are the timing and amounts of the cash flows generated by the project, as well as the impact of the project on income taxes to be paid.

When Using One of the Discounted Cash Flow Methods to Evaluate